Rizal Commercial Banking Corporation (RCBC) announced it was making most InstaPay transfers free starting July 4. Good news for RCBC customers, sure, except the Bangko Sentral ng Pilipinas (BSP) isn’t fully convinced.

The Yuchengco-led bank announced on Friday, July 3, that InstaPay transfers through RCBC Pulz, its main mobile banking app, and RCBC DiskarTech, its financial inclusion app, would be free starting July 4 as banks move to comply with new BSP rules meant to bring down digital transfer fees.

But there’s a catch.

RCBC Pulz customers may make only up to 30 free InstaPay transfers per month, with a minimum amount of P100 per transaction. Transfers below P100 or beyond the monthly free allocation will still be charged P10. DiskarTech users, meanwhile, will get free person-to-person InstaPay transfers with no minimum amount and no monthly cap.

But the BSP appears to be saying that “free” can’t come with too much fine print under its new circular.

BSP Deputy Governor Mamerto Tangonan told reporters on Friday that the central bank had already spoken with RCBC over its fee structure. (READ: Banks, e-wallets have until July 4 to lower transfer fees – Bangko Sentral)

“We talked to Reggie,” Tangonan said, referring to RCBC president and chief executive officer Reggie Cariaso. “We said that’s not compliant with the [circular].”

The circular in question is BSP Circular No. 1238, which takes effect on July 4. It sets a new pricing framework for fund transfers with the goal of bringing down fees for banks and e-wallets.

Asked if there should be no limit on free transfers, Tangonan went back to the circular’s pricing logic.

“If you read the circular, all it says is the pricing mechanism,” Tangonan said. “So, all we say is that whatever you charge, the price of your off-us transaction must be the same as your on-us [or] cannot be more than your on-us price plus the switch fee. That’s all it says,” he added.

To put it simply, if transfers within the same bank are free, then transfers to another bank or e-wallet should generally cost only the switch fee. For InstaPay, that switch fee is industry-wide and around P1.50.

Making all transfers free but adding a 30-transfer cap is toeing the line. If an RCBC Pulz customer is still charged P10 after using up 30 free InstaPay transfers, BSP may ask whether that P10 fee can still be justified under the new framework. After all, the circular is trying to prevent a wide gap between what banks charge for transfers within the same bank and those to another.

Tangonan explained it quite directly: “Bank A to Bank A, free. And then, if you want to maintain that free Bank A to Bank A, free, when you do Bank A to Bank B, it should be [just] plus switch.”

There was another curious omission. RCBC talked about free InstaPay transfers, but said nothing about PESONet. That may be another wrinkle. Tangonan stressed that the BSP circular covers person-to-person transfers more broadly, not just one payment rail.

“It’s person-to-person transfer. But person-to-person, there’s InstaPay, there’s PESONet,” he said in a mix of English and Filipino at the sidelines of a BSP book launch on Friday.

If you recall, this was also the same pricing math Bank of the Philippine Islands (BPI) faced. They chose the cleaner route — just kill the fee entirely.

BPI-to-BPI transfers were already free, so under BPI president and chief executive officer TG Limcaoco’s reading of the circular, charging for transfers to other banks would mean charging only around P1.50. For him, it wasn’t worth the irritation.

“We said, why would we still charge P1.50? You’re just needling the customer. But P1.50, will it make a big difference for us now? No,” Limcaoco said in a mix of English and Filipino.

“We think this is great for financial inclusion,” he added. “If banks are willing to give on-us for free, why wouldn’t you give the P1.50 also?”

So what happens to RCBC now?

The BSP official said institutions covered by the circular have until July 4 to comply. Asked what enforcement action would mean if they don’t, Tangonan described a ladder that starts off easy but can get less pleasant.

“First, there’s a friendly reminder. And then, there’s another reminder, less friendly,” he said.

When asked what would happen if other banks start using a model similar to RCBC’s, Tangonan said, “Well, we’ll talk to them.”

Asked whether the BSP had already told RCBC to change its mechanism, Tangonan left reporters with a teaser, “Just wait for tomorrow.”

The timing is also not exactly ideal for RCBC. The bank is entering the second half of the year under closer scrutiny after Moody’s Ratings revised its outlook on RCBC’s credit ratings to negative from stable, citing expectations that the bank’s solvency metrics could weaken as asset quality deteriorates.

RCBC, for its part, has said it is entering the second half from a position of “deliberate strength” while taking steps to protect its balance sheet in a more challenging macroeconomic environment.

“My objective remains the same — to protect, scale, and elevate the strong franchise that is RCBC,” Cariaso said during the bank’s 2026 annual stockholders’ meeting.

Will RCBC and other banks still charging transfer fees relent? The BSP’s July 4 deadline should make that clear soon enough. – Rappler.com